Council questions purchasing rules
City Council members are voicing renewed unhappiness with rules that are forcing them to do buy police cars from an out-of-town dealership.
They nonetheless appear likely to approve a $556,822 contract with Butler Chrysler Dodge Jeep Inc., which is based in Beaufort, S.C.
By law, “we have to award the contract to the lowest responsive, responsible bidder,” Finance Director David Boyd told members at a work session Thursday.
The only Durham-based dealer to bid for the contract, Sport Durst Chrysler Dodge Jeep, offered to sell the city the 22-car package for $583,990.
Fleet Management Department analyst Michael Boyd attributed the difference to the business arrangements Dodge has with Butler and that Butler has with state government.
Butler is one of three dealers from which the state is buying police vehicles, and the only one that offers the Dodge Chargers that Durham’s cops prefer. The city is piggybacking on the state’s contract.
The other two state-chosen dealers sell Chevrolets and Fords and are based in Raleigh.
Because it holds the state contract, Butler gets a volume discount from Dodge’s factory and corporate staff and thus can undercut offers from other dealers, Michael Boyd said.
The difference in this case is nearly $1,235 a car.
Dodge corporate managers “have almost told us that whoever has the state contract can’t be beat unless the local dealership is willing to lose money on the deal,” Michael Boyd said in answer to questions from Councilwoman Cora Cole-McFadden.
The councilwoman plainly wasn’t happy to be sending business outside Durham.
“We always try to make sure we do business in our own city,” she said. “But a firm from South Carolina – not even North Carolina – has that.”
The issue is one that council members have raised before, most recently in 2010 when bid laws forced them to buy Fords from a Raleigh dealership that undercut a Durham competitor’s price by about $300 a vehicle.
They followed up in early 2011 by asking Durham’s N.C. General Assembly delegation to sponsor a bill that would allow the city to tilt the scale in favor of local contractors.
But delegation members balked, instead getting behind a measure that allows the city to ask bidders to allot a portion of their subcontracting to local firms. It passed the General Assembly in the late spring of 2011.
City officials are applying it to relatively small contracts for construction, architectural, engineering and surveying services.
Durham legislators refused to support a broader bill for fear of encouraging other North Carolina cities to institute their own local-business preferences, potentially curbing trade between communities to the detriment of Durham-based firms.
Despite Cole-McFadden’s questions, council members plan to approve the Butler contract on Oct. 7. They put it on the consent agenda for that night’s business meeting, meaning they do not expect to discuss it further.
Michael Boyd told members it’s possible the city would send any warranty-covered repair work needed on the vehicles to Sport Durst or another local dealer.